Pulp maker Paper Excellence has obtained a court decision allowing completion of its deal to acquire Brazilian company Eldorado Brasil Celulose from J&F Investimentos, according to documents seen by Reuters.
Judge J.B. Franco de Godoi, at an appeals court, voided a previous court injunction that prevented Paper Excellence from concluding the transfer of ownership of Brazilian pulp maker Eldorado.
Paper Excellence won an arbitration against Eldorado’s current controlling shareholder, J&F Investimentos, which also controls meatpacker JBS SA (JBSS3.SA). But J&F went to the courts and obtained an injunction preventing the transfer of 100% of Eldorado shares to Paper Excellence. Now the judge in the appeal has voided the injunction.
Paper Excellence’s CEO in Brazil, Claudio Cotrim, said in a statement he will focus now on concluding the deal and operating the factory in the Brazilian state of Mato Grosso do Sul. Paper Excellence will then consider how soon it can build a second unit, with an estimated capital expenditure of 10 billion reais ($1.94 billion).
J&F said it will appeal the latest decision, arguing the arbitration it lost was tainted.
The Eldorado deal has been on hold for five years. It was signed in September 2017 but never concluded due to the parties’ disagreement over the closing.
($1 = 5.1609 reais)